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The Union Budget 2026-27 focuses on transforming India into a global biopharma hub with the Biopharma Shakti scheme.
It also announced customs duty exemptions on critical drugs.
Centre plans to expand the caregiving workforce and boosting medical value tourism.
Allocation for Ministry of AYUSH increased 20% over 2025-26 RE.
Union Finance Minister Nirmala Sitharaman, presenting her 9th budget on February 1, 2026, announced that the centre will be launching a Biopharma Shakti scheme to make India a global biopharma hub.
With an outlay of Rs 10,000 crore over five years, the scheme will focus on biologicals, biosimilars and non-communicable diseases such as diabetes, cancer and autoimmune disorders, Sitharaman noted.
SHAKTI stands for ‘Strategy for Healthcare Advancement through Knowledge, Technology and Innovation’.
Under the scheme, three new National Institutes of Pharmaceutical Education and Research will be set up and the existing seven will be upgraded. Further, a network of more than 1,000 accredited clinical trial sites will be created and the Central Drugs Standard Control Organisation (CDSCO) will be strengthened with specialised scientific review capacity. This, the finance minister said, will help CDSCO to meet global standards and approval timeframe.
The overall allocation for the Union Ministry of Health and Family Welfare for financial year 2026-2027 was Rs 1,06,530.42 crore, with Rs 4,821.21 crore to the department of health research. This department received a 26 per cent higher allocation than last year’s Rs 3,900.69 crore.
In one of the commendable announcements, the Union Budget 2026-27 proposed exemption of basic customs duty on 17 drugs or medicines to provide relief to patients, particularly those suffering from cancer. It also proposes to add seven more rare diseases for the purposes of exempting import duties on personal imports of drugs, medicines and Food for Special Medical Purposes (FSMP) used in their treatment.
The Budget 2026-27 tied the goals of creating employment with that of strengthening the health workforce. Sitharaman announced that institutes for Allied Health Professionals (AHP) will be expanded across government and private sectors, and existing ones will be upgraded. The training will span 10 disciplines, including optometry, radiology, anaesthesia, operation theatre technology, and applied psychology and behavioural health. The Centre aims to add 100,000 new AHPs over the next five years.
The finance minister also announced that 150,000 caregivers will be trained in the next year through National Skills Qualifications Framework-aligned programmes to support the country’s care and geriatric health ecosystem, and create jobs. These courses, she added, will blend core caregiving skills with wellness practices such as yoga, alongside training in operating medical and assistive devices.
With an aim to boost medical value tourism, the government will launch a scheme to establish five Regional Medical Hubs in partnership with states and the private sector, according to Sitharaman. These will be integrated healthcare complexes, combining medical services with education, research, diagnostics, rehabilitation, AYUSH centres and facilitation units for international patients.
The Union Budget 2026-27 proposes an allocation of around Rs 4,409 crore for the Ministry of AYUSH — about 20 per cent higher than the revised estimates of Rs 3,672 crore for 2025-26. A notable increase is earmarked for the conservation, development and sustainable management of medicinal plants under Dharti Aaba Janjatiya Gram Utkarsh Abhiyan (DAJGUA), a central scheme aimed at the holistic development of tribal communities and villages. The Budget allocated Rs 15 crore for DAJGUA in 2026-27, up from Rs 5 crore in the revised estimates for the previous year.
The Budget noted that the additional funding will benefit farmers cultivating medicinal herbs and young workers engaged in processing them, while helping produce export-grade Ayurvedic products.
Three new All India Institutes of Ayurveda have been planned, the finance minister announced. Further, upgrades to AYUSH pharmacies and drug-testing labs have been envisioned. The WHO Global Traditional Medicine Centre in Jamnagar will also be strengthened for evidence-based research, training and global outreach, she added.
The budget proposed setting up National Institute of Mental Health and Neuro Sciences (NIMHANS)-2 in north India and upgrading national mental health institutes in Ranchi and Tezpur as regional apex centres. The Centre also plans to expand emergency and trauma care capacity by 50 per cent in district hospitals, according to Sitharaman.